MSI survey reveals retailers falling behind with online strategies

An October MSI Global Alliance survey looking to identify the rate of change from traditional business models to the online environment reveals that more than one third of retailers (42 per cent) who see the internet as a threat to their own revenue bases have not implemented a strategy to counter the threat posed by online competitors. Of this group, one fifth (21 per cent) said they do not intend to implement an online strategy.

In all, 72 per cent of retailers said that online competitors in the same market as them pose a threat to their current revenue bases.

More broadly, the survey of 822 Australian and New Zealand retailers, wholesalers and business-to-business service providers by legal and accounting group MSI Global Alliance revealed that 75 per cent of the businesses polled agreed that thesuccess of the internet has now pushed them to change the way in which they transact business with customers.

Of the three groups polled, fewer retailers (63 per cent) have changed the way in which they transact with customers to include an online option in addition to face-to-face business.  This compares to 85 per cent of wholesalers and 77 per cent of business-to-business service providers.

By contrast, 65 per cent of all wholesaler participants and 60 per cent of all business-to-business service providers have implemented a business strategy as 70 per cent of wholesale and only 49 per cent of business-to-business service providers believe that actual and prospective online businesses in the same market have the potential to take market share from their company, impacting current revenues.

Now vs. five years ago

The survey also looked at movement towards online trading over the past five years. Results of the survey show in the all three sectors that there has been a significant shift in the proportion of business which now transact online compared to five years ago with the largest increase seen in both the wholesale and retail sectors.  Sixty-five per cent (65 per cent) of retail businesses polled currently transact a proportion of their business online compared to 27 per centof retailers just five years ago.  In the wholesale sector, 85 per cent now transact a proportion of their business online compared to only 35 per cent five years ago. In the business-to-business sector, 83 per cent of respondents now transact a proportion of business online compared to 53 per cent five years ago.

On releasing the survey results, MSI Global Alliance Australia and New Zealand Chairman Alec Blacklaw said: ‘It is worrying that so many retailers who have clearly identified the online threat against their current revenues have indicated they have no plan or strategy to deal with the threat. It is never too late to adopt new technology and embrace a different way of doing things.  Businesses need to consider the potential impact on their future revenues and profitability by developing specific plans to review and refresh their business models.’

Results snapshot:

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MSI Global Alliance: International association of accountancy and law firms

MSI Global Alliance (MSI) is a top ranked, international association of independent accountancy and law firms. Since 1990, growing entrepreneurial companies have benefited from seamless access to the interrelated expertise of accountants, auditors, lawyers, tax advisors and other specialist professionals within over 250 member firms across 105 countries worldwide. In Australia and New Zealand, MSI consists of 14 independent legal and accounting firms that provide specialist services to local and overseas businesses.

We provide our clients with access to local knowledge and broad professional experience of over 8,000 professional experts worldwide. We have a unique multidisciplinary approach to serving clients that makes MSI different from the large firms and networks.

In addition, every one of MSI's member firms is independently owned and managed by principals who are committed to involvement in their client's business challenges. Along with a rigorous member firm selection process, this ensures high standards of service and unrivalled knowledge of local markets. Member firms work together on behalf of clients who face cross border issues, ensuring sophisticated local expertise is supported by global professional relationships, and that clients enjoy positive business outcomes.

For further information about MSI visit www.msiglobal.org or to go direct to the Australian and New Zealand pages www.anz.msiglobal.org